World Bank expects UAE's real GDP to grow by 5.9 pct in 2022

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The World Bank has said it expects the UAE’s real GDP to grow by 5.9 percent in 2022, while GCC economies are projected to grow 6.9 percent across the six-member economic bloc this year.

The World Bank announced its new Gulf Economic Update (GEU) report on Monday where it said higher oil receipts supplemented with a gradual non-oil recovery in the Emirates will bolster fiscal revenue resulting in a fiscal surplus to hover around 4.4 percent of GDP in 2022, state news agency WAM reported.

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Recent bilateral free trade agreements with Asian partners supported by strong oil exports will place the UAE's current account surplus at 11.2 percent of GDP in 2022, according to the report.

However, the bank expected the real GDP to moderate to 4.1 percent in 2023 as slower global demand may dampen growth due to tightening financial conditions.

Across the GCC, the easing of coronavirus-induced movement and social restrictions,­­­ and positive developments in the hydrocarbon market drove strong recoveries in 2021 and 2022, the World Bank said in its report released on Monday.

The report noted that the GCC region is “expected to register strong twin surpluses in 2022 and continue over the medium term. The regional fiscal balance is projected to register a surplus of 5.3 percent of GDP in 2022 – the first surplus since 2014 -- while the external balance surplus is expected to reach 17.2 percent of GDP.”

“There is an excellent and timely opportunity to diversify the economy further using a green growth strategy, and playing a leading role in the global transition to low-carbon economies,” said Issam Abousleiman, World Bank Regional Director for the GCC. “The region could use the green growth transition to focus policies on developing green technologies and associated skilled labor that would reverse trends in productivity and enable the region to grow faster.”

Total economic output of the GCC countries is projected to be about $2 trillion in 2022, according to the World Bank.

“If the GCC continued business as usual, their combined GDP would grow to an expected US$ 6 trillion by 2050. However, if the GCC countries implemented a green growth strategy that would help and accelerate their economic diversification, GDP could have the potential to grow to over US$ 13 trillion by 2050.”

Saudi Arabia, the Arab world’s largest economy, is forecast to grow 8.3 percent in 2022 before moderating to 3.7 percent and 2.3 percent in 2023 and 2024, respectively.

The oil sector will remain the main driver behind the Kingdom’s economic growth.

Read more:

Middle East oil-exporting countries to grow at 5.2 pct in 2022: IMF

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